CNBC TechCheck Evening Edition: May 28, 2025
CNBC's TechCheck brings you the latest in tech news from CNBC's 1 Market in the heart of San Francisco.
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Yahoo
26 minutes ago
- Yahoo
Forget tacos, can Trump have his tariff cake and eat it too? Wall Street's biggest bull thinks so
If President Donald Trump's tariffs settle around 10%, that could still allow the Federal Reserve to cut rates later this year while they generate revenue that helps with the massive budget deficit, according to Wells Fargo's Christopher Harvey, who thinks a levy at that level could be split between importers, corporations, and consumers. There has been much talk lately about President Donald Trump and tacos, but another food entering the tariff conversation could be cake. While his 'Liberation Day' announcement roiled markets, he has largely pulled back from his most aggressive stance since then, though on Friday night he said he will double steel tariffs to 50%. The overall direction of travel remains positive for Chris Harvey, Wells Fargo Securities' head of equity strategy, whose S&P 500 price target of 7,007 makes him Wall Street's biggest bull. 'The Trump administration does want to move things forward,' he told CNBC on Friday, hours before the steel announcement. 'They appear to want to push the ball forward, and I think that's a positive. We're now at the point where I think we're going to start to hear some real tangible results over the next couple of weeks.' Harvey added that he thinks stocks could jump by double digits in the second half of the year. His S&P 500 forecast implies an 18.5% surge from Friday's close. A key piece to his thesis is Fed Governor Christopher Waller's recent statement that if tariffs end up around 10%, then the central bank could be in a position to cut rates in the second half of the year. Tariffs are generally seen as inflationary and could force the Fed to hold off on monetary easing. But if consumers treat them as one-off price hikes and keep their longer-term inflation expectations anchored, then there could still be leeway to lower rates. For now, the effective tariff rate remains above 10%, though estimates differ. The Budget Lab at Yale put it at 17.8% last month, while Fitch put it at 13%. Harvey expects tariffs to settle in the 10%-12% range and said that even as clients express anxiety about all the uncertainty, they are still comfortable with the economy's fundamentals. That prompted CNBC's Scott Wapner to ask if Trump can have his cake and eat it too, namely, moving ahead with his tariff agenda and getting the Fed rate cuts that he's been demanding. 'I think so,' Harvey replied. 'So the reason why we said 10% is with 10% we think a third will be eaten by the importer, a third eaten by the corporation, and a third will be eaten by the consumer. That's not a big impact.' At the same time, he added that the tariffs will generate revenue that can help with the federal budget, which has seen massive deficits in recent years. Fears that deficits will worsen under Trump's proposed budget working its way through Congress have led to volatility in borrowing costs as bond market jitters have jolted Treasury yields. Meanwhile, as trade talks continue, it's more important for the Trump administration to reach deals with India, Japan and the European Union, Harvey said, adding that China is less critical since the U.S. is in the process of disintermediation from it anyway. But if tariff uncertainty stretches into June and July, then companies may start resizing their payrolls and then 'things start to fall apart,' he warned. That's why it's necessary to make progress on trade and reach deals with big economies like India, Japan and the EU, Harvey said. That way, markets can focus on next year, rather near-term tariff impacts. 'Then you can start to extrapolate out,' he explained. 'Then the market starts looking through things. They start looking through any sort of economic slowdown or weakness, and then we start looking to '26 not at '25.' This story was originally featured on Sign in to access your portfolio
CNBC
5 hours ago
- CNBC
Investors are piling into big, short Treasury bets alongside Warren Buffett
Investors always pay close attention to bonds, and what the latest movement in prices and yields is saying about the economy. Right now, the action is telling investors to stick to the shorter-end of the fixed-income market with their maturities. "There's lots of concern and volatility, but on the short and middle end, we're seeing less volatility and stable yields," Joanna Gallegos, CEO and founder of bond ETF company BondBloxx, said on CNBC's "ETF Edge." The 3-month T-Bill right now is paying above 4.3%, annualized. The two-year is paying 3.9% while the 10-year is offering about 4.4%. ETF flows in 2025 show that it's the ultrashort opportunity that is attracting the most investors. The iShares 0-3 Month Treasury Bond ETF (SGOV) and SPDR Bloomberg 1-3 T-Bill ETF (BIL) are both among the top 10 ETFs in investor flows this year, taking in over $25 billion in assets. Only Vanguard Group's S&P 500 ETF (VOO) has taken in more new money from investors this year than SGOV, according to data. Vanguard's Short Term Bond ETF (BSV) is not far behind, with over $4 billion in flows this year, placing with the top 20 among all ETFs in year-to-date flows. "Long duration just doesn't work right now" said Todd Sohn, senior ETF and technical strategist at Strategas Securities, on "ETF Edge." It would seem that Warren Buffett agrees, with Berkshire Hathaway doubling its ownership of T-bills and now owning 5% of all short-term Treasuries, according to a JPMorgan report. "The volatility has been on the long end," Gallegos said. "The 20-year has gone from negative to positive five times so far this year," she added. The bond volatility comes nine months after the Fed's began cutting rates, a campaign it has since paused amid concerns about the potential for resurgent inflation due to tariffs. Broader market concerns about government spending and deficit levels, especially with a major tax cut bill on the horizon, have added to bond market jitters. Long-term treasuries and long-term corporate bonds have posted negative performance since September, which is very rare, according to Sohn. "The only other time that's happened in modern times was during the financial crisis," he said. "It is hard to argue against short term duration bonds right now," he added. Sohn is advising clients to steer clear of anything with a duration of longer than seven years, which has a yield in the 4.1% range right now. Gallegos says she is concerned that amid the bond market volatility, investors aren't paying enough attention to fixed income as part of their portfolio mix. "My fear is investors are not diversifying their portfolios with bonds today, and investors still have an equity addiction to concentrated broad-based indexes that are overweight certain tech names. They get used to these double-digit returns," she said. Volatility in the stock market has been high this year as well. The S&P 500 rose to record levels in February, before falling 20%, hitting a low in April, and then reversing all of those losses more recently. While bonds are an important component of long-term investing to shield a portfolio from stock corrections, Sohn said now is also a time for investors to look beyond the United States with their equity positions. "International equities are contributing to portfolios like they haven't done in a decade" he said. "Last year was Japanese equities, this year it is European equities. Investors don't have to be loaded up on U.S. large cap growth right now," he said. The iShares MSCI Eurozone ETF (EZU) is up 25% so far this year. The iShares MSCI Japan ETF (EWJ) Japan ETF is up 25% over the last two years.
Newsweek
13 hours ago
- Newsweek
List of Walgreens Stores Closing This Month
Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources. Newsweek AI is in beta. Translations may contain inaccuracies—please refer to the original content. Walgreens is closing more than 20 stores this month as the drug store giant looks to boost revenue and shutter underperforming locations. The closures arrive after Walgreens announced in October it would be closing roughly 1,200 underperforming stores across the U.S. over the next three years. In 2025, 500 locations will say goodbye to shoppers. Why It Matters Many retail giants have slimmed down their national footprint in the years following the COVID-19 pandemic. Lower brick-and-mortar demand as a result of online shopping as well as inflationary effects on spending have played a role. Malls have long been falling out of favor, with almost 25 percent of America's largest anticipated to close by 2027, according to research from real estate services firm Green Street Advisors. Facade of a Walgreens store in Laurel Heights, San Francisco, on April 30, 2025. Facade of a Walgreens store in Laurel Heights, San Francisco, on April 30, 2025. Smith Collection/Gado/Getty Images What To Know While Walgreens operates roughly 8,500 stores nationwide, the pharmacy and drug store chain has closed about 2,000 locations over the past decade. Why is Walgreens Closing Stores? The closures arriving this month as CEO Tim Wentworth said Walgreens is embarking on a "turnaround plan." "We are confident it will yield significant financial and consumer benefits over the long term," Wentworth previously said. Because more consumers are using online prescription services like pharmacies have felt pressure on their bottom line as costs rise. In the last quarter of fiscal year 2024, Walgreens reported a $3 billion loss, an increase from $180 million the year before. Only 6,000 of its stores are still profitable, Wentworth said. "This solid base supports our conviction in a retail pharmacy-led model that is relevant to our consumers, and we intend to invest in these stores over the next several years," he said. Walgreens had sales of $37.55 billion for the fourth quarter, a year-over-year increase of 6 percent and fourth-quarter sales and adjusted profit above Wall Street expectations, according to CNBC. The $3 billion loss reflects the so-called valuation allowance that is meant to reduce deferred tax assets mainly related to opioid settlements, CNBC reported. Which Walgreens Locations Are Closing in June? In June, Walgreens is closing stores across several states, including: California Salinas, N. Sanborn Road – June 25 Florida Jacksonville, Dunn Avenue – June 26 Miami, NW 7th Avenue – June 25 Illinois Chicago, N. Sheffield Avenue (Northstar Health Care) – June 23 Massachusetts Brockton, Pleasant Street – June 23 Fall River, S. Main Street – June 26 Gloucester, Eastern Avenue – June 23 Springfield, Boston Road – June 24 Swansea, Wilbur Avenue – June 23 Webster, Main Street – June 24 Worcester, Grafton Street – June 25 New Jersey Pleasantville, N. Main Street – June 23 New York New York City, Lexington Avenue (Duane Reade) – June 24 Syracuse, Genesee Street – June 26 North Carolina Durham, Broad Street – June 24 Raleigh, Wake Forest Road – June 26 Ohio Garfield Heights, Turney Road – June 24 Reynoldsburg, Brice Road – June 10 Washington Bremerton, State Highway 303 NE – June 23 West Virginia Clendenin, Elk River Road N. – June 25 Follansbee, Main Street – June 11 Mullens, Moran Avenue – June 23 New Martinsville, 3rd Street – June 10 Oceana, Cook Parkway – June 26 Whitesville, Lewis Street – June 24 Which Stores Have Already Closed? Walgreens shuttered many other locations in 2025 so far. The full released list is: California Hayward, Jackson Street – May 22 Los Gatos, Blossom Hill Road – May 22 Colorado Lakewood, 7665 W. Jewell Avenue – May 22 Connecticut East Hartford, Silver Lane – May 20 East Haven, Main Street – May 22 New Britain, Stanley Street – May 19 New Milford, Danbury Road – May 21 Florida Jacksonville, Soutel Drive – May 19 Georgia Decatur, Hairston Road – May 22 Lawrenceville, Old Norcross Road – May 19 Macon, Mercer University Drive – May 21 Snellville, Hewatt Road – May 20 Stone Mountain, Memorial Drive – May 19 Indiana Indianapolis, E. Thompson Road – May 20 Maryland Essex, Marlyn Avenue – May 20 Massachusetts Framingham, Waverly Street – May 19 Lakeville, Main Street – May 21 Peabody, Andover Street – May 20 Salem, Boston Street – May 19 New Jersey Cherry Hill, Kings Highway N. – May 19 New York Brooklyn, 5th Avenue – May 21 Middletown, Fitzgerald Drive – May 21 North Carolina Richlands, Richlands Highway – May 21 Sanford, Spring Lane – May 20 Pennsylvania Norristown, Dekalb Pike – May 19 Southampton, 2nd Street Pike – May 22 West Chester, E. Street Road – May 22 Wyncote, W. Cheltenham Avenue – May 15 Texas Dallas, Camp Wisdom Road – May 21 Newsweek reached out to Walgreens for comment via email. What People Are Saying Kevin Thompson, the CEO of 9i Capital Group and the host of the 9innings podcast, told Newsweek: "Walgreens is just the latest casualty in the private equity game of cost-cutting. This is about reducing retail footprint, shrinking lease obligations, and driving return on equity. It's textbook: slash costs, close underperforming stores, and try to recoup the investment." Drew Powers, the founder of Illinois-based Powers Financial Group, told Newsweek: "Not that long ago it seemed like there was a drugstore on every corner, and many of those were Walgreens. But foot traffic has slowed for Walgreens as more big-box stores and online outlets added pharmacy services. Add to slower sales the evermore stringent regulations, decreased reimbursements, and increased cost of staff and Walgreens posted a $3 billion loss in the 4th quarter of 2024. While they can weather that storm for a while, the only survival plan is to close more retail locations." Alex Beene, a financial literacy instructor for the University of Tennessee at Martin, told Newsweek: "Walgreens is encountering what many other large nationwide retailers are: higher prices combined with more online competition, particularly in groceries and pharmaceuticals, have meant some locations are less profitable. After trying to turn business around at these locations the last few years, Walgreens has made the decision to close them." What Happens Next Thompson said more store closures are likely in the months ahead. "Consumers should prepare for fewer nearby locations, longer drive times or in some areas, no local access at all," he said. Powers said Walgreen's financial situation is indicative of the larger pharmacy industry, and a shift is already underway. "It's an unfortunate situation that's not limited to their stores," Powers said. "Other pharmacies will more than likely have to make similar tough decisions in the years ahead."
